India's new Avatar

'He is ignoring all the documents and clearances, he is talking like an NGO!'

The outburst was directed against N.C. Saxena, member of the powerful National Advisory Council, former bureaucrat, a confidant of UPA chairperson Sonia Gandhi and the government's go-to expert on issues of poverty, forests and tribal rights.

In India's corridors of power, calling someone "an NGO" is an expression of scorn and resentment. Both feelings were evident as I talked to Mukesh Kumar, Chief Operating Officer of Vedanta Aluminium Limited, part of the Vedanta group, a global corporate wonder that's grown to 54 times its size from 2000. In terms of value, Vedanta is India's third largest conglomerate after the Tata group and the Mukesh Ambani group.

Over two conversations that lasted an hour, Kumar vented his fury at the scathing observations of a government committee headed by Saxena: Don't clear mining in Orissa's Niyamgiri Hills, an anticipated source of bauxite for Vedanta's aluminium refinery, which has grown six times in capacity and violated a raft of forest, environmental and tribal rights laws.

Released three days ago, the 163-page report acknowledges that mining will affect the Dongaria Kondh, a primitive tribe that's now a cause celebre in international environmental circles after being likened to the Na'vi, the blue-skinned nature-loving aliens massacred by greedy human miners in the 2009 movie Avatar. Vedanta says no village will be displaced, no Dongaria Kondh made homeless, and that the Saxena committee says "nothing" that the Supreme Court did not observe in according conditional clearance — subject to regulatory approval — in 2008.

When I spoke to Saxena, he said: "I told them [the state government and Vedanta] to file a case of contempt against me. I dare them to." Saxena told me local officials were "very reluctant" to give him and three fellow committee members data on Vedanta's project, with one district official saying they could "collect it from the Supreme Court". Unsurprisingly, the Saxena-committee report accuses Vedanta of "total contempt for the law" and "an appalling degree of collusion on the part of the concerned officials".

While talking to Kumar, it was hard to tell sometimes if I was talking to a corporate executive or a representative of the Orissa government, which is run by the Biju Janata Dal, a part of the opposition National Democratic Alliance. "How are such issues raised only in Chhattisgarh or Orissa?" Kumar asked.

Well, I could have pointed out the Ministry of Environment and Forests, headed by Jairam Ramesh, was now equally hated in Congress-ruled Maharashtra, where it's questioned the location of a second airport at Navi Mumbai amidst a mangrove forest.

But Kumar had spoken long and passionately about changing rules, the decade-long effort to get his aluminium refinery underway, the electrification of 13 villages, the 20,000 children being fed mid-day meals (but this I learnt subsequently hasn't started yet), the 43 Vedanta child-care centres, the leaf-plate making courses for tribal women, the company's "mission" to eradicate malaria, and the "tremendous pressure for employment" from the locals that apparently prompted the company to start operations without final clearances. He insists all clearances are in place for the existing operations. So, it seemed irrelevant to point out that Ramesh, clearly with Sonia Gandhi's blessings, over the last six months was pushing an environmental crackdown, irking even fellow Congressmen and cabinet colleagues running the highways, coal, steel and tribal affairs ministries.

I have gone into the Vedanta case in some detail because it illustrates India's developmental dilemmas at a time when New Delhi is increasingly mindful of a growing image and insurgency problem.

Investors as diverse as the Church of England and the Norwegian government, sold investments in Vedanta as the controversy over the Indian Na'vi ground on. The concern that unequal growth is endangering the idea of India is reflected in the Saxena committee report: "This committee is of the firm view that allowing mining in the proposed mining lease area by depriving two primitive tribal groups of their rights over the proposed mining site in order to benefit a private company would shake the faith of tribal people in the laws of the land which may have serious consequences for the security and well being of the entire country."

Saxena believes the tribals are getting the rawest deal in the new India, and in a letter to Sonia Gandhi has warned that the methods of the Ministry of Tribal Affairs are contributing to the spread of Maoism.

Ramesh has many consequences to consider and a lot of balancing to do. Tomorrow, another evaluation of the Vedanta project — once pushed by the Prime Minister's Office — begins. The Forest Advisory Committee (it shares a committee member with Saxena's group; Amita Baviskar, a PhD from Cornell University and professor at New Delhi's Institute of Economic Growth) will make a recommendation that Ramesh will use in his final decision, due next week. Every insider says it's unlikely there will any mining on Niyamgiri. By the weekend, another committee will decide the fate of Navi Mumbai's new airport. That, too, appears unlikely.

Last week, Ramesh's ministry ordered the Orissa government to stop land acquisition for India's biggest direct foreign investment, the R54,000 crore steel plant proposed by South Korea's Posco, after another four-member committee — headed, again, by Saxena — reported widespread violations of forest and tribal-rights laws. The pressure to reverse this decision is growing with Union Minister of Steel Virbhadra Singh vowing to intervene. As I write this, angry officials — those Saxena's committee accuses of collusion — from Orissa are flying into Delhi to lobby Vedanta's case.

Will India's laws prevail? Will Ramesh get his way? Will a new balance emerge?